The Insurance Australia Group Ltd (ASX: IAG) share price has plunged in the past month amid a series of negative announcements.
Yesterday, the insurance giant's shares encountered further losses, falling 0.62% to $4.84. In comparison, the S&P/ASX 200 Index (ASX: XJO) lifted 1.01% to 7,370.2 points.
Below, we take a closer look at IAG's most recent result and how its shares have performed since.
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What did IAG report for FY21?
IAG delivered its full-year results for the 2021 financial year to investors before market open on 11 August. The IAG share price closed the previous day at $5.28, just 4% off its 52-week high of $5.51.
Across the board, IAG recorded a mostly positive performance with growth in several key metrics:
- Gross written premium (GWP) improved 3.8% to $12,135 million
- Insurance profit jumped 35.9% to $1,007 million
- Underlying insurance margin fell 130 basis points to 14.7%
- Reported insurance margin grew 340 basis points to 13.5%
- Net loss after tax of $427 million
- Cash earnings up 170% to $747 million
- Unfranked final dividend of 13 cents per share bringing full-year dividend to 20 cents apiece
IAG managing director and CEO Nick Hawkins commented:
… I have put in place a new, more customer aligned operating model, reset our strategy for growth, and appointed a leadership team with deep insurance and customer expertise, and clear accountability for success. We are already seeing results from these changes and have momentum behind our strategy.
How did the IAG share price respond?
In the weeks following IAG's result, its shares moved sideways before starting to descend on 7 September. Over that period, its shares have fallen almost 20%.
When looking at the last 12 months, the IAG share price is up by around 7.5%, with a smaller increase of just over 2.5% year to date. It's worth noting however, the company's shares have lost about 40% of its wealth since August 2019.
In contrast, the ASX 200 has gained 25% from this time last year and is up around 10% in 2021. The ASX 200 also reached a record high of 7,632 points in mid-August.
This shows that IAG shares have been outperformed by the benchmark, which historically tracks about 6% higher each year.
IAG commands a market capitalisation of roughly $11.93 billion and has approximately 2.47 billion shares on its books.
